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Currency Outlook

Rupee Outlook

• Rupee depreciated yesterday amid risk aversion in the global markets and FII outflows. Further, rupee slipped on strong dollar and elevated US treasury yields

• Rupee is expected to depreciate further today amid firm dollar, equity outflows and weak global market sentiments. Dollar is gaining strength as recent data highlighted the strength of US economy relative to its peers, reinforcing expectations that US Fed would keep rates higher for longer duration. Moreover, investors will remain cautious ahead of inflation figures from US to get more clues on interest rate outlook. USDINR Nov is likely to rise towards 83.48 level as long as it sustains above 83.15 levels

Euro and Pound Outlook

• Euro edged lower yesterday amid firm dollar and pessimistic global market sentiments. Further, ECB left its key rates unchanged, in line with market expectations. For today, EURUSD is likely to slip further towards 1.0500 levels as long as it remains below 1.0580 amid firm dollar and weak global market sentiments. Further, ECB’s pause in its rate hike regime and statements signaled that central bank is done with aggressive tightening and will allow past increases to be transmitted into financing conditions. EURINR Nov may move south towards 87.80 as long as it stays below 88.30 levels

• Pound is expected to dive towards 1.2070 level amid firm dollar and risk aversion in global markets. Further, gloomy economic data affirmed view that BOE may hold rates steady. GBPINR is likely to edged lower towards 100.80 as long as it trades below 101.50 level.

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